— Holding back third-graders who are far behind in their reading skills and requiring elementary school teachers to earn a literacy credential are among ideas being considered by South Carolina’s education oversight panel.

An annual report released Monday by the Education Oversight Committee shows that schools are not improving fast enough to meet the panel’s 2020 goals. The unsurprising report — which looks similar to previous reports — prompted chairman Neil Robinson to call for action.

“In order for the world to be within our reach, the path forward needs to look quite differently,” he said. “We can’t continue to operate our schools the same way and expect different results.”

The report shows that far too many schools are underperforming — with 9 percent of students statewide attending schools at or near the bottom of the state’s grading system — and one in five high school students not graduating within five years.

Many of those who do graduate aren’t prepared.

According to the state’s technical colleges, 41 percent of graduates need remediation in math and reading, costing taxpayers $21 million annually for the faculty needed to teach students what they should have learned in high school.

Robinson advocates tossing the high school exit exam, which students first take their sophomore year and can retake multiple times to pass. The test, which costs the state $3.6 million, does nothing to help students entering college or trying to get a job, he said. Robinson suggests replacing it with the ACT college entrance exam and WorkKeys, tests that assess workers’ skills and award credentials in the bronze, silver, gold and platinum levels — which students can take to an employer.

State Superintendent Mick Zais said he supports that idea.

Officials agree that students’ success hinges on their reading skills in the early grades. Thirty-two states have laws designed to get more students reading on grade level by the end of third grade — considered an indicator of students’ likelihood of earning a diploma, rather than dropping out. South Carolina does not.

In South Carolina, improvement on reading proficiency is flat, the report shows, citing 61 percent of fourth-graders and 72 percent of eighth-graders passing national tests on reading.

The full EOC board discussed ideas Monday for transforming the system but took no action. Robinson said he will appoint a subcommittee this week to study ideas and make recommendations for legislation.

Those ideas include requiring all teachers in kindergarten through eighth grade to take graduate-level classes to earn a literacy credential — five classes for elementary school teachers and three for middle school teachers. The credential could meet the state’s continuing-education requirements.

Early intervention for struggling readers could include summer reading camps, required summer school, and holding back third-graders who fail end-of-year tests on reading. Helping students earlier may involve testing students in the primary grades.

“We have got to identify kids early on who are struggling readers and intercede early on,” said EOC executive director Melanie Barton.

She suggested paying for the initiatives by shifting money from elsewhere.

The state currently pays $136 million on remediation efforts in schools that aren’t producing the needed results, she said.

The nonpartisan EOC was created by the state’s 1998 education accountability law and consists of 18 business, legislative and education leaders. They are responsible for evaluating the state’s progress toward meeting education goals and issuing state report cards for schools and districts.

It reset those goals in 2009 after legislators revamped the state’s end-of-school-year tests.